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Did you lose money during 1989 US Coin Market Crash?
Cougar1978
Posts: 8,765 ✭✭✭✭✭
I remember going to a Psychic in April 1988 right before a coin show about a non numismatic issue.
She was right on about a lot of things about my present situation and hit some predictions. She blew it on one major one.
I asked her about the rare coin market: She said "sell everything in the summer."
Consider the 1989 crash this may have not been bad advice. At the time, I did not have that much invested in coins and when I started taking tables at shows in 1990 many items were at reduced levels which not bad for the expansion of my investment activities.
She was right on about a lot of things about my present situation and hit some predictions. She blew it on one major one.
I asked her about the rare coin market: She said "sell everything in the summer."
Consider the 1989 crash this may have not been bad advice. At the time, I did not have that much invested in coins and when I started taking tables at shows in 1990 many items were at reduced levels which not bad for the expansion of my investment activities.
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3 year old me probably chewed on a few pennies.
I did wellin the crash except for sitting on about 30 1969 mint sets I should have sold. They went from $20 to $3. I had sold all my obsolete Gems in '87-'89.
Everything else is an illusion.
I remember going to a Psychic in April 1988 right before a coin show about a non numismatic issue.
She was right on about a lot of things about my present situation and hit some predictions. She blew it on one major one.
I asked her about the rare coin market: She said "sell everything in the summer."
Consider the 1989 crash this may have not been bad advice.....
Actually, that was pretty bad advice by Miss Cleo. April 1988 was about the time of the Baltimore show as I recall and market liquidity and prices at that time were lousy. I was trying to sell choice and gem type coins for just decent money, and it wasn't easy. In particular I was walking the floor trying to lesson inventory for the next auction. I had just made an NGC MS65 1846 TD half dollar. I was looking to make 10-15% on it and could only find buyers at the $4200 level, or about 0-5% over what I paid. Begging someone to buy a better date early seated half for barely over $4K was a joke. 15 months later that coin tripled to the $12K level. Today, I think it's in a MS66 holder and probably pop 1 for that variety. If that's the same coin I think it recently sold in the $35K level.
The coin market moved fast and furious from mid-1988 to summer 1989. And a lot of the gem type coin market even held fairly firm into April 1990. April 1988 was a weak time to sell. Some parts of the market did peak in summer 1989 and crash (ie gem commems and silver dollars, gem generic gold, etc.). Those would have been things to get out of in summer 1989.
Forecasting a coin market peak in summer 1989 wasn't all that difficult considering collectibles in general and the housing market were peaking in the 1988-1990 time frame.
How did I cope with this? I got discouraged and basically stopped collecting coins for 20 years, (so wasn't even aware of the '89 crash) but also learned a couple of valuable lessons.
- Jim
Check out some of my 1794 Large Cents on www.coingallery.org
If you own gem quality coins in 1989, who did not lose money? The question should be "did you recover from your 1989 loss and how did you do that
Are you kidding? Ever see the charts in the blue sheet
I didn't lose any money in the 1989 Crash only because I didn't start collecting again until 1991 after a 25 year hiatus for college, sports, girls, professional school etc. I did buy a lot from 1991 on and am glad I did!
So did I but the rest of the decade was pretty slow. I did well but it was tough. I did get some good estate buys here and there. I think a lot of people who got burned in the 89-90 crash just never came back. I remember a stock broker coming to coin club meetings at that time recruiting investors.......
I probably still own most of the coins purchased in the 1980's, apart from some upgraded pieces.
Started collecting again in 1995 and was active mostly 1999-2006, the internet is what brought me back, without eBay and this forum, would still be out of the game.
Liberty: Parent of Science & Industry
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
If you own gem quality coins in 1989, who did not lose money? The question should be "did you recover from your 1989 loss and how did you do that
Are you kidding? Ever see the charts in the blue sheet
The charts don't show what happened to the MS-65 coins that were undergraded. If you had premium MS-65's you would not have lost money.
I had been working on a Large Cent collection of VG-F coins and I had just bought my first one or two nicer ones. I only sold off the 1813 last year - it was nice, but didn't grade because of an old cleaning. I drank the koolaid last year and had all of my Large Cents certified & TrueViewed.
I had bought 5 each of the 1/4 oz and 1/2 oz AGEs raw in 1988 & 1989, but I stopped doing that due to lack of funds. I wish I had kept that up another 2 or 3 years, because the best keys happened in those years.
In 1989, I was buying 15 Proof ASEs every year "for investment". I threw in the towel on them in 2006, but not before I had a 1993 Proof go PR-70. That was my major score.
I stopped buying Proof ASEs cold in 1995 when Phillip Diehl made it impossible to continue the accumulation unless I bought 15 of the 4-coin AGE sets that also had the 1995-W. I knew what was going to happen with that coin, and it did. That was the last time I didn't buy a Mint offering out of principle. The Mint has none, and I forgot all that. That's when I became a speculator, albeit with collector tendencies.
Now that the Mint is ramping up their premiums on collector bullion from the 30-35% range up to the 45-60% range, it's a new ballgame. They may have destroyed their own market and just don't know it yet.
I knew it would happen.
In evaluating coin market performance I go by the PCGS 3000 Index. It shows coins declined 65% since 1989 and lost 5.27 % in the last year. My Portfolio is pretty much spread across the board and includes both coins (both vintage and modern) and currency (both US and World).
No loss for me since I do not sell coins....bought some then.... and I would never go to a psychic...If they could foretell things they would already be wealthy.... Cheers, RickO
...yup and in the gambling community there ain't one person that believes in a psychic
jom
A lot of them got burned so badly in 89 market crash they never really went back to coins except bullion. Some of these guys paid as much as $1000 for generic morgan dollars in slabbed MS65, etc. One went to US Large Size currency and did very well picking off Gem Notes, especially NBN's as it was undervalued at that time. I started buying some Modern World Gold which I could get close to melt.
A number of fellow coin club members had to file bankruptcy because of such large losses on coins in 89 crash financed on high interest credit cards. The kept the coins and let the credit card companies eat the losses I believe one guy had as much as $100 K in cc debt financing his coin investments. It cost even one guy a divorce from his pretty blonde Trophy Wife, really pretty Cali girl that looked like a Cheerleader. She had been pushing him for a new house for a long time but with the bankruptcy and a job loss, it would be awhile. A few jumped ship on coins all together and went to stocks. One guy auctioned all of his coin investment books starting at a dollar in the cc club meeting. Some even could not get bids even at a dollar - he said "well these are for the garbage then." I took a couple of them for free to try sell from my table at shows like for 5 bucks, carried them a long time with only one or two selling then at one show just gave away to kids.
I remember one big name national dealer coming up to my table late in 1990 trying buy my slabbed coins at blue sheet with some kind of hype "this is the real market now." I told him "unless you have some sell me at that get lost and don't ever come back."
All of the type coins that were bought for me in 1987-88 have done ok. I was only 10 in 1989. I also have no plans to sell those any time soon.
Gonna get me a $50 Octagonal someday. Some. Day.
A lot of people got burned in the '89 crash and many will never come back.
I'll never understand why people believe in "free money". Unless you're a banker or CEO there is no such thing as free money. When everyone is telling you to buy, you need to sell. When they're telling you to sell, you need to buy. People are so desparate to be liked and be with the majority, they'll do anything and they do it without thinking. All they had to do was look and see how common Gem Morgans were and ask themselves if $1000 price tags were justifiable. If you invest in anything you need to look at the fundamentals and the fundamentals of these coins was that they were "collected" more by investors than numismatists which is a very weak fundamental. It was just as weak as paying huge premiums for bags of moderns in 1964 with the intention of selling them to the ever increasing hobby base. The hobby already had enough of these coins to swamp any potential demand for centuries.
Coins are great as a collectible. That sometimes they'll go sky high just attracts people who don't realize they're already sky high.
No.
I lost, on paper, a bit of value on gold. For circulated early US coins, such as bust half dollars and early copper, prices remained mostly stable from consistent supply/demand of that market segment.
Hard to believe that common slabbed Morgans were going that high!
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I was 12 then. I collected Lincoln cents, Liberty nickels and cool foreign coins that caught my eye. I probably still have 90% of the coins I had then.
My father-in-law had a collection of U.S. commemorative halves, and just before the 1989 Pittsburgh ANA I told him that the market was going nuts and it was a good time to sell. He agreed so I took his collection with me, and ended up sitting next to a dealer I knew on the plane going there. It was a very hot market, so he asked if I had anything to sell. I pulled out my briefcase, showed him the coins and the list I had, and we shook hands on a deal at around $38K. The next day he came by our table and he paid me. Two days later the bottom fell out. A couple of years later I found a copy of the list, and figured that I could buy the coins back for about $10K.
Completely missed it as well. I was OLD enough to have been collecting, but I was a late bloomer.
But it's probably good that this period in the coin collecting world gets re-hashed every once in a while! You know what they say: Those who do not learn from the past are doomed to repeat it.
(The tough part is differentiating the "Chicken Little's" from the honestly concerned and concerning).
Like BillJones, my losses were only on paper. I told my wife we lost $65k in coins and her response was: "Did we have that much money in it?" Whenever I told her that no we did not have that much in it and that it was a paper loss, her reply was: "So we didn't really lose anything, right?"
They weren't. $1,000 for generic common MS65's is not accurate. What did happen was common MS65's bringing $600-$750 or so when PCGS first opened its doors in 1986....and it only lasted as long as the amount of coins available was nil. This was a case of nearly zero supply and unlimited demand. And I suspect those kinds of prices required really strong MS65 pieces for that time. And considering you could still buy raw MS65's at your local dealer for a fraction of those levels, the dealers weren't exactly fooled as to why there was such a huge spread.
MS65 common Morgan came down into 1987, 1988 and 1989. They were never $1,000 in 1989 or 1986...unless one single coin brought that much. I bought dozens of them from Larry Hanks at the spring Boston Bay State show in 1990 when the market was still humming along....paid $100 for MS64's and $300 for MS65's. In hindsight, those were still lousy deals as they wouldn't bottom until MS65's reached about $74-$76 per coin in the 2002-2003 period. Checking the sheets for late May 1989, MS65 Morgans had their last hurrah at approx $510. By December they were $300 or so.
The blue sheet was a darn accurate price guide in the 1988-1990 period when so many slabbed coins traded sight-unseen....or at least many big players didn't care what the coin looked like....they had a customer for it. Blue Sheet was probably as accurate or better than the grey sheet. And if you were turning down blue sheet prices as the market crashed in later 1990, that was probably a mistake. The blue sheet of today vs. the one of 1988-1990 has little in common. During the market peak of 1989-1990 it was quite common to get 5-15% or more over blue sheet for solid for the grade, high dollar type coins, commems, Morgans, and better dates. If the coin was so-so for the grade, you'd be happy to get blue sheet bid/ask. The big boyz needed product for their investors so they weren't too fussy on how the PCGS/NGC coins looked. I often sold all my available inventory over the phone (sight-unseen, no returns) to bigger retailers. And then it was on to the next Stacks or Bowers and Merena auction to buy more raw coins to get slabbed.
I started buying circ. early type coins in1989 . I have done very well!
Good move. Those were basically ignored in the run up years of 1986-1990. Investors wanted an MS66 FB common date Merc for $200-$300 rather than an VF 1839-0 half or XF 1847-0 25c. It was nuts actually.
Yes, I still remember that weekend. I was set up behind the table at a little coin show in Ca. when common date PCGS MS65 Morgan and Walkers traded hand for $750-$850 ea. I was offered $21,500 for these two $10 Libs , but decided not to sell
and the party was over by the following weekend at the Baltimore show. I still own these two coin today... 
Nope. Sold everything in the summer of 88 and did not collect until 1998. Had a family to raise.
Ken
I didn't recall $10 Libs getting that high. So I pulled out the May 26, 1989 blue sheet and sure enough, the bid for those 2 coins was $21,475. You got offered $25 over bid. And since it was off blue sheet, I can imagine being hesitant to sell if the coins were really nice. Crazy times.
I didn't lose money, then again I wasn't alive yet either...
Andrew Blinkiewicz-Heritage
I was 3 years old, but with the stories from the forum here I get to learn from the past. Hopefully to not be repeated.
Those 2 1906-D $10 Libs - PCGS MV = 11250 for both and this with gold run up since then. in 1990 with 21500 I could have bought probably around 100 half ounce World Gold Coins like some of the 1980's Canada $100 Gold Commems. - that's 50 oz of gold. In 2011 could have sold for close to $100K. If only could know future........
I had just only started buying slabs in 1989 (not that many) at that time so not badly burned from the crash. I remember making some good money on a World Silver Commem Set. I found I could buy more coins once those coins sold at retail. Some coins I would sell in one month then a coupla months later get them much cheaper lol.
World Gold was cheap in 1990 and a super deal vs US. As far as bluesheet, never could really buy at that and amazed of guys who would come to my table trying to use it to buy from me - they sounded like old has been strippers trying sell at lap dance. So to cut thru their BS, I did an excel analysis of Dealer Asking Prices vs Greysheet and the result was an average of about GS + 40% on average. A guy in the coin club had bought about 20 MS 65 Morgan Dollars prior to the crash really lost big time. He went to a SC that was near where the coin club was and over several evenings spent the proceeds of the sale (or course a big loss) on booze and girls. After that he got into US Large Size Currency and never looked back. Of course currency has gone big time since then.
People get so wrapped up with the holder, this TPG or that one, sheet and sticker game they forget what would happen if those businesses went under sometime in the future due to either economic collapse or competition from some other grading / pricing venue idea (AI self grading holder you can buy at Walmart for $1.50).. Or course currency and world coin collectors would not be as badly affected.
Interesting - a psychic told me in April of 1988 "sell everything in July." when I asked her about the coin market. I had heard her on new age radio and called the number the next day booking an appointment on the way to a coin show. I did buy 2 Double Eagles at the show for $600 a piece so not phased by it at that time.
No,
I was 17 and just graduated from high school so I had very little left from selling stuff I had collected earlier. Was spending money on stereo stuff for the car, girls and what have you, really didn't get back to collecting seriously till 1994-5 era